Economic Valuation of the Barrier Reef-Free-Samples for Students

Question: Discuss about the the Economic Valuation of the Barrier Reef. Answer: Introduction The Great Barrier Reef of Australia is considered as the largest living thing the Earth and it can be visible from the outside of the space. The Great Barrier Reef is 2300 kilometer long and it comprises of thousands of reefs and a large number of islands. From the recent information, it can be seen that one of the three major accounting firms all over the world, Deloitte has made the valuation of the Great Barrier Reef. As per the valuation of Deloitte, the total valuation of the Great Barrier Reef is $56 billion. Some major aspects or issues are connected with the valuation of the Great Barrier Reef. Some of the aspects are the valuation process of the Great Barrier Reef; different issues related with the valuation of the Great Barrier Reef; role and interest of different stakeholders and many others. All these aspects are discussed below. Discussion In case of the valuation of the Great Barrier Reef, Deloitte has used a specific technique. In this particular case, Deloitte conducted a survey that consisted of Australian as well as International residents in order to understand what their valuation approaches of techniques of the Great Barrier Reef are. In this valuation process, IPSOS Public affairs helped Deloitte Access Economics. Deloitte conducted the survey on 1000 Australians and 500 international residents. The valuation process was designed in such a way that biasness and limitations in the valuation process can be avoided effectively. International residents included people from many countries like Canada, China, Germany, Mexico, India, South Africa, Spain, United Kingdom and United States of America. All these specific foreign countries were selected as these counties have most number of visitors of the Great Barrier Reef comparing to the other countries (Economics 2013). Deloitte conducted the survey based on the onli ne basis. As a result of this survey, Deloitte determined the estimate value of the Great Barrier Reef and this value was beyond its pure economic contribution to the economy of Australia. Most of the focus was on three major areas. First, the general perception and attitude towards the Great Barrier Reef as a global asset by the Australians and the international people. Second, the Australian and global tourists activities and their costs related to the Great Barrier Reef. Third, the enthusiasm of the Australian and international people to pay for the future health of the Great Barrier Reef. After the analysis of the survey results, they were combined with certain economic methods in order to get the economic, social and icon value of the Great Barrier Reef (Authority 2014). At the time of the valuation of the Great Barrier Reef, it can be seen that Deloitte had to face certain difficulties. Two of the major issues are the issue of extreme weather and the issue of water quality. It has been seen that due to the effects of global warming, the weather of the world have been changing adversely and this process has its effects on the valuation of the Great Barrier Reef (deloitte.com 2017). Apart from this, with the negative effects of bad water, Deloitte faced great difficulties to determine the actual value of the Reef. The matching of language and tone was another major issue at the time of conducting the survey. As a result, it affected the valuation process of the Reef. Deloitte had to face issue at the time of determining the traditional owner economic value of the Great Barrier Reef. Deloitte also faced issues at the time of deterring the international value of the Reef. Most importantly, Deloitte did not take any help of any theoretical approaches in order to solve the issues (Authority 2012). Based of the valuation of the Great Barrier Reef by Deloitte, it can be said that this is a fair valuation. There are some reasons behind this. First, Deloitte has taken an unique approach that is survey of Australians and international people to understand their perception about the valuation of the Great Barrier Reef. This process has been helpful for the determination of the actual valuation method of the Great Barrier Reef. On the other hand, Deloitte considered all necessary aspects at the time of the valuation of the Great Barrier Reef; these aspects are non-use valuation, direct use valuation, indirect use valuation and economic, social and icon value (Authority 2014). It needs to be mentioned that the valuation of the Great Barrier Reef was needed in order to make the people aware about the importance of Great Barrier Reef. It has been seen that many Australians started to consider the fact that the Great Barrier Reef has no value. With the valuation of the Reef, the Australian as well as people all over the world will be able to know the actual economic value of the Great Barrier Reef. It is expected that people will take initiatives to protect the Great Barrier Reef after knowing the actual worth of it (Brander et al. 2012). There are many stakeholders involved with the valuation of the Great Barrier Reef. Two of the major stakeholders are Deloitte and the Great Barrier Reef Foundation. The main motivation of these two parties is to make people aware about the worthiness of the Great Barrier Reef as they have started thinking that the Reef of priceless. With the valuation, they will be able to make the people aware about the economic value of the Reef. The people of Australia and all over the world are another group of stakeholders of the Reef. These people include common people, tourists and many others. The valuation of the Reef will make them able to develop corrective measures for the protection of the Great Barrier Reef (Rolfe and Windle 2012). Most of the stakeholders will be beneficial from the valuation of the Great Barrier Reef as they will be able to know the economic valuation of the Reef. Apart from this, they will be able contribute to the cause to protect the Great Barrier Reef. In this regard, Agency Theory related to the stakeholders can be mentioned. As per the principles of this theory, the stakeholders will be able to use their power towards the protection of the Great Barrier Reef and this aspect works as a major motivation for the stakeholders. Thus, the principles of this theory have a deep connection with this aspect (barrierreef.org 2017). For the valuation of the Great Barrier Reef, the Accounting Valuation theories play an integral part. In this regard, it needs to be mentioned that the Accounting theory regarding the Valuation of Intangible Assets is appropriate for the valuation of the Reef. With the principles and standards of Valuation of Intangible Assets, the reason of the valuation of the Reef can be explained. From the valuation of the Reef, people all over the world will get intangible benefits like people can go for tourism in the Great Barrier Reef, the world environment will be benefitted with the valuation and others. It needs to be mentioned that all these are intangible benefits. In case there is not any valuation of the Reef, people from Australia as well as all over the world will not be able to enjoy the intangible benefits of the Reef. Thus, it can be said that the principles and standards of Valuation of Intangible Assets theory is appropriate in this regard (Axtle-Ortiz 2013). From the above discussion, it can be said that the people of Australia as well as all over the world will be beneficial from the valuation of the Reef. In the valuation of the Reef, there are some accounting theories that re helpful; they are Valuation of Intangible Assets, Valuation of Natural Resources Asset Pricing Valuation. With the help of these accounting models and theories, it is possible to measure the impact of the valuation of the Great Barrier Reef. Thus, based on the above discussion, it can be said that the overall impact of the valuation of the Reef will be positive (Uno, K. and Bartelmus 2013). Conclusion From the above discussion, it can be said that the valuation of the Great Barrier Reef is a major move from Deloitte and the Great Barrier Reef Foundation towards the protection of the natural phenomena. It can be seen that Deloitte used some effective measured in order to get the economic valuation of the Great Barrier Reef. 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